DEA-90 – Phase III “Drilling Plastic Shale at Great Depth – A Study to Improve Penetration Rates with Environmentally Acceptable Drilling Fluids”

Active Project Summary

DEA-90 Phase III   “Drilling Plastic Shale at Great Depth – A Study to Improve Penetration Rates with Environmentally Acceptable Drilling Fluids”

DEA Project Number: DEA-90 Phase III

Project Title: Drilling Plastic Shale at Great Depth-A Study to Improve Penetration Rates with Environmentally Acceptable Drilling Fluids

Contractor: TerraTek, Inc. 400 Wakara Way Salt Lake City, UT 84108 (801) 584-2400 Att; Alan Black

Email: ablack@terratek.com

World Wide Web Site: www.terratek.com

Startup Date: Phase III – March ’99

Scope of Work: The objectives of DEA 90 Phase III are to extend field application in the following areas; 1. Determine the effectiveness of ROP enhancers in higher density fluids, including the effects of concentration and time. 2. Determine the effectiveness of ROP enhancers in different drilling fluids. 3. Determine the application of advanced PDC bits, drilling fluids, drilling fluid additives and drilling practices to improve ROP and avoid other related problems.

Current Status: ExxonMobil joined the program since the last update – History; A kick-off (planning) meeting was held end March, 1999. A first series of drilling tests were successfully conducted with ROP enhancers and results reviewed with the participants at an August, 1999 meeting hosted by Shell in Houston. Additional tests were conducted in November and a progress meeting was held with the 5 participants on March 14, 2000 at BP Amoco’s facilities in Houston. The two companies joined the program early ‘00 (MI, Texaco) based on the successful ROP demonstrations in shale with additives. The program continued its testing program during 4Q ’00 and both the Baroid and MI additives were evaluated during drilling of shale at simulated depth conditions. One additional company ExxonMobil joined this program early ‘01, thus two additional drilling tests were planned at a progress meeting convened on February 7, 2001 at MI Drilling Fluids. We anticipated holding a progress review meeting by or on 20th September 2001 after drilling the ExxonMobil recommended tests, however these tests are now scheduled to be conducted around September 20, 2001. Additionally another operator (international) is in the process of joining DEA 90. This program has been very successful in identifying drilling performance problems in shale and the effects with certain additives.

Projected Completion Date: 4Q ’01

Project Cost: $180,000 with 6 sponsors

Participants: Shell, BP Amoco, Baroid, MI Fluids, Texaco, ExxonMobil, 7th in progress

Cost per Participant: $30,000

Comments: The program is still open for additional participants. Preliminary Phase 4 program requirements were discussed at the beginning of 2001 and that discussion will continue at the next Advisory Meeting.